Assembly Committee on Energy and the Committee on Corporations, Authorities and Commissions Preliminary Findings Regarding the Potential Closure of Indian Point Energy Center

February 10, 2012

The Committees based their preliminary assessment on testimony submitted at the January 12th hearing in New York City. The evidence demonstrated that there are a number of scenarios that, with proper planning, could offset the electricity produced by the Indian Point Energy Center.

Key Findings

The New York Independent System Operator (NYISO) testified that the State has more than an adequate level of generation capacity and upgrades to the existing transmission system would make better use of statewide generating resources, including renewables from windpower projects.

The NYISO also noted that there are a number of generation projects proposed in Southeast New York that could add up to 2,000 megawatts of new power by 2015 and several transmission projects that could bring up to 3,000 megawatts online by 2016.

According to the NYISO, relieving the historic congestion bottlenecks that impact the economic operation of New York’s electric system could free up over 1,500 megawatts from existing power plants. The testimony specifically referenced constraints in the Central to East and Leeds to Pleasant Valley corridors.

The New York City Master Electricity Plan, prepared by Charles River Associates, identified the Leeds to Pleasant Valley constraint as one of the most cost effective projects to meet the City’s electricity needs.

Consolidated Edison testified that there are a number of options that can be considered for replacing Indian Point’s electric capacity, energy and voltage support, including demand side management and energy conservation programs, new electric generating facilities or new electric transmission lines to import power from regions where there is a surplus.

The City of New York identified aggressive strategies to conserve electricity and develop clean distributed generation, including:

efforts to increase participation in demand side management programs;

streamline permitting for cogeneration projects;

utilization of high efficiency combined heat and power technology;

co-locating anaerobic digestors and photovoltaics at wastewater treatment facilities; and

participation in a 350 megawatt off-shore wind collaborative.

The Department of Public Service testified that in prior instances where generator retirements presented reliability risks, transmission solutions were the most cost effective options.

Excerpts from Written Testimony presented to the Assembly Standing Committee on Energy and the Assembly Standing Committee on Corporations, Authorities and Commissions on January 12, 2012

"In the notice of hearing for today’s proceeding, the Committees included requests for certain financial information from Entergy. We must respectfully decline the requests, consistent with our responses to earlier requests for such information."

T. Michael Twomey, on behalf of Entergy: Page 9

“Whether Indian Point remains in service or not, it may very well be prudent to pursue upgrades to the existing transmission system to make better use of statewide generating resources, including renewables from wind power projects already developed and for

those additionally proposed throughout upstate New York.”

Rick Gonzales, Senior Vice President and Chief Operating Officer for the New York ISO: Page 2

“Statewide, New York has more than an adequate level of generation capacity.”

Rick Gonzales, Senior Vice President and Chief Operating Officer for the New York ISO: Page 5

“Additionally, there are a number of generation projects proposed in Southeast New York that may come into service by 2015. These projects could add up to 2,000 megawatts of new resource capability.”

Rick Gonzales, Senior Vice President and Chief Operating Officer for the New York ISO: Page 6

“Several transmission projects have been proposed that could bring up to 3,000 megawatts of additional capability into Southeastern New York by 2016.”

Rick Gonzales, Senior Vice President and Chief Operating Officer for the New York ISO: Page 6

“Upgrades to the existing transmission system could provide reliability benefits by allowing upstate resources to meet the needs of the New York City metropolitan area. These same transmission upgrades could provide consumer benefits by relieving some of the historic congestion bottlenecks that continue to impact the economic operation of New York’s electric system.”

Rick Gonzales, Senior Vice President and Chief Operating Officer for the New York ISO: Page 7

“There are potential STARS projects that could increase transfer capabilities by over 1,500 megawatts from upstate to Southeast New York. By improving the capability of the Central to East and Leeds to Pleasant Valley transmission corridors, New York could increase its ability to move excess generation from upstate to downstate load centers. The upstate and western areas of New York State have the greatest potential for the development of renewable resources. I believe such transmission upgrades would also add significant reliability benefits by allowing for a more diverse set of generating resources to meet New York’s electric needs.”

Rick Gonzales, Senior Vice President and Chief Operating Officer for the New York ISO: Page 8

“There are a number of options that can be considered for replacing Indian Point’s electric capacity, energy and voltage support, including demand side management and energy conservation programs, new electric generating facilities or new electric transmission lines to import power from regions where there is a surplus.”

“In terms of reducing our environmental footprint, our City government is taking a leadership role by committing to reduce its greenhouse gas emissions by 30% by 2017, more than a decade sooner than our citywide goal of a 30% reduction by 2030. To achieve this goal, the City has allocated 10 percent of our $800 million energy budget roughly $80 million a year—to reduce energy consumption in City buildings, and invest in clean distributed generation and renewables.”

Sergej Mahnovski, PhD, on behalf of the City of New York: Page 3

“New York City has also taken aggressive efforts to promote energy efficiency in privately owned buildings.”

Sergej Mahnovski, PhD, on behalf of the City of New York: Page 6

“We are also aggressively working to increase the development of renewable energy in New York City.”

Sergej Mahnovski, PhD, on behalf of the City of New York: Page 4

“We are also enhancing our load shedding capabilities during peak events. For example, we will be issuing a Request for Proposals (RFP) in the coming months to look for ways for City-owned buildings to participate more actively in demand response programs, which will help Con Ed better manage peak load events.”

Sergej Mahnovski, PhD, on behalf of the City of New York: Page 3

“To foster private development of cogeneration, we are working with Con Edison to streamline the permitting and interconnection processes, and to improve coordination with natural gas system planning. We are also supportive of regulatory changes by the Public Service Commission to remove barriers to cogeneration investments in New York City.”

Sergej Mahnovski, PhD, on behalf of the City of New York: Page 5-6

“We are also working to increase deployment of high-efficiency combined heat and power (CHP) or “cogeneration” systems at both City owned and private building sites.”

Sergej Mahnovski, PhD, on behalf of the City of New York: Page 5

“Developing cogeneration projects using our anaerobic digester gas (ADG) as a renewable fuel at several of our wastewater treatment plants.”

Sergej Mahnovski, PhD, on behalf of the City of New York: Page 5

“We are also working with developers to build solar projects on the most favorable and underutilized municipal assets, such as large rooftops at wastewater treatment plants and brownfield sites such as capped landfills.”

Sergej Mahnovski, PhD, on behalf of the City of New York: Page 4

“In order to encourage the development of utility scale wind resources in the New York City area we are working with Con Edison, Long Island Power Authority (LIPA), and the New York Power Authority (NYPA) as a part on the Long Island-New York City Offshore Wind Collaborative to explore the development of at least 350 MW of offshore wind 13 miles off the south shore of Long Island and the Rockaway Peninsula by 2018. We think this is a potentially transformative investment and we look forward to next steps in the development process.”

Sergej Mahnovski, PhD, on behalf of the City of New York: Page 5

“In some cases there were no reliability needs associated with the retirement, in other cases transmission solutions to address the reliability need arising from generator retirement was the least cost strategy for addressing the reliability issues.”

Raj Addepalli, Deputy Director, Office of Electric, Gas and Water, New York State Department of Public Service: Page 3

Also cited: “A Master electrical Transmission Plan for New York City” CRA International, 50 Church St. Cambridge, MA 02138: Prepared on May 28, 2009